PGE Polska Grupa Energetyczna S.A. Just Missed Revenue By 5.7%: Here's What Analysts Think Will Happen Next

It's been a good week for PGE Polska Grupa Energetyczna S.A. (WSE:PGE) shareholders, because the company has just released its latest first-quarter results, and the shares gained 2.5% to zł7.13. Results look mixed - while revenue fell marginally short of analyst estimates at zł27b, statutory earnings were in line with expectations, at zł1.56 per share. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

See our latest analysis for PGE Polska Grupa Energetyczna

After the latest results, the five analysts covering PGE Polska Grupa Energetyczna are now predicting revenues of zł101.8b in 2023. If met, this would reflect a huge 22% improvement in sales compared to the last 12 months. Statutory earnings per share are forecast to sink 15% to zł1.52 in the same period. In the lead-up to this report, the analysts had been modelling revenues of zł107.1b and earnings per share (EPS) of zł1.92 in 2023. From this we can that sentiment has definitely become more bearish after the latest results, leading to lower revenue forecasts and a pretty serious reduction to earnings per share estimates.

The analysts made no major changes to their price target of zł10.52, suggesting the downgrades are not expected to have a long-term impact on PGE Polska Grupa Energetyczna's valuation. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic PGE Polska Grupa Energetyczna analyst has a price target of zł14.40 per share, while the most pessimistic values it at zł7.70. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. The analysts are definitely expecting PGE Polska Grupa Energetyczna's growth to accelerate, with the forecast 30% annualised growth to the end of 2023 ranking favourably alongside historical growth of 23% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to see a revenue decline of 3.3% annually. So it's clear with the acceleration in growth, PGE Polska Grupa Energetyczna is expected to grow meaningfully faster than the wider industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Sadly they also cut their revenue estimates, although at least the company is expected to perform a bit better than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for PGE Polska Grupa Energetyczna going out to 2025, and you can see them free on our platform here..

Before you take the next step you should know about the 1 warning sign for PGE Polska Grupa Energetyczna that we have uncovered.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.